Escrow Account System Improvement Act

Summary

Escrow Account System Improvement Act - Requires an escrow account to be established in connection with any federally related mortgage loan if, at the time the loan is made or at any time thereafter, either the borrower or the lender requests it. States that any such account shall be continuously maintained (without any right on the part of the borrower to withdraw any part thereof) until the borrower has fully discharged his obligation under the loan. Provides that whenever the borrower in connection with a federally related mortgage loan has acquired an equity of at least 20 percent in the property covered by the loan and enters into an agreement to maintain a savings account with a balance equal to assessments and hazard insurance premiums: (1) the lender shall no longer have the right to require the establishment of an escrow account in connection with such loan, and (2) the borrower shall have the right to terminate any escrow account theretofore established in connection with such loan. States that on each deposit in an escrow account which is made in connection with a federally related mortgage loan to a bank, interest shall be paid from the date of deposit to the date of withdrawal at a rate not less than the rate then prevailing for loans by Federal Reserve banks to member banks in the district where the property involved is situated. Sets forth limitations on requirements by lenders of advance deposits in escrow accounts of taxes and insurance premiums.

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1 official file

• Introduced in House

  summary · EN · 4 January 1977

  Open at official source

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